Cryptocurrencies are currently undergoing the biggest downfall in their history, with some comparing the losses — like the $7.3 billion loss in Bitcoin in the last three days — to the Lehman Brothers crash in 2008. However, fashion companies are still announcing that they’re accepting crypto in online and offline channels, showing an unlikely loyalty to the web3 currency.
Alo Yoga announced on Wednesday that it will be extending crypto payments to online purchases for customers. It is also going one step further by being the first fashion company to allow its full- and part-time workers to receive paychecks in crypto, opening up a new way for retail establishments to pay workers. The move into crypto isn’t limited to fashion brands, as luxury retail platforms like Farfetch are also accepting the web3 currency in their mono- and multi-brand boutiques. With the currency at an all-time low, is fashion hedging its bets for the future?
“We always want to be ahead of the curve,” said Danny Harris, co-founder and CEO of Alo Yoga. “Activating in the metaverse was that first step for us, and enabling crypto payments takes it even further. Introducing a real-world connection to web3 is something that we find more of our customers are interested in.”
For Alo Yoga, the move comes as an extension of its current investment in web3, following the launch of Alo Sanctuary, a meditation and yoga island in Roblox, in January. Speaking about the results from the Roblox partnership, Alo vp and global head of marketing Angelic Vendette said, “In the three months since launch, we’ve seen about 40 million unique visitors to our metaverse. We’ve also seen about 48 million pieces of our digital fashion being worn on avatars on the platform. This move into cryptocurrency is just continuing the roadmap and leaning into web3.”
Alo Yoga’s option to receive paychecks in crypto will be extended to the 350 full-time salaried employees at the company. Whether this will be a popular option remains to be seen, but it could be an interesting addition once the market stabilizes, as it eliminates transaction fees.
“It increases the ease of regular cryptocurrency trade, along with [facilitating] no interest and further rewards for [employees],” said Vendette. “We definitely do see this as a perk — giving our employees the option to decide where they want to put their money, whether that be in their bank account, [in] an investment platform, or [in] web3.”
For Farfetch, crypto serves as a new payment method for its customers and shows a new step in its solidification of plans for the metaverse. According to CEO José Neves, there are many retail players that provide cryptocurrency payment processing online, but very few have solid POS solutions in stores. Luxury brands like Gucci, Off-White and Philipp Plein have announced they will be accepting crypto in their regular stores.
Thus, the addition of cryptocurrency in Farfetch stores also includes POS hardware. “Farfetch has partnered with global cryptocurrency platform Lunu for its omnichannel solution, which includes sleek POS terminals for in-store transactions and an online widget,” said Neves.
Additionally, Farfetch’s partnership with Lunu means that the company doesn’t have to handle the cryptocurrency at any point. Lunu accepts the cryptocurrency from the customer on Farfetch’s behalf, exchanges it for fiat currency and then remits that fiat currency to Farfetch. “Through the partnership, we can help contribute to the adoption of widespread cryptocurrency payments within the luxury industry,” said Neves.
The luxury space certainly seems primed for the move, with luxury being an easier transition to the collectible space of NFTs and having strong brand presence within metaverses. However, brands like Alo Yoga are also seeing large customer turnout on platforms like Roblox.
The Alo Yoga launch on Roblox attracted a new demographic that is willing and able to engage with the brand in the metaverse. “The crypto move is a continuation of our investment in the metaverse space, not only knowing that we’re future-proofing our brand, but we’re also meeting our customers where they are,” said Vendette.”They are definitely early adopters and have expressed interest in bringing their wellness practice and activating it with us within web3, holistically.”
The brand will also be announcing an NFT launch during the next New York Fashion Week as the event’s wellness partner.
Farfetch’s expansion also follows customer interest, showing the continued link between luxury and web3. “Customers are increasingly interested in new ways to pay, and cryptocurrency is growing in importance for the luxury customer base,” said Neves. The retailer will be expanding the feature to more customers, leading first with Farfetch Private Clients in the coming months; this will be expanded to all customers in the U.S., the U.K. and Europe in late 2022, with other countries to follow.
In early 2023, the retailer will also be offering cryptocurrency payment capabilities to its brand partners as part of its Platform Solutions enterprise offering. Current brands that are using the offering include British retailer Harrods, as well as Burberry, Chanel, Thom Browne (which recently launched as part of Meta’s digital fashion offering) and Zegna. Farfetch will take its findings from the early adoption of cryptocurrency payment services and share this expertise with the Farfetch community of boutiques and brands looking to offer this solution in their retail stores in the future.